• by May 1, 2001

Buys For The Asking

Adweek reports that according to a Morgan Stanley report, the news on CPMs isn't all bad. At an average CPM of $3.50, online banners remain a cost-effective branding tool--especially when compared to

a. $16 CPM for primetime broadcast television,
b. $6 for magazines and radio and
c. $19 for newspapers.

The report estimates that banners are 40 to 80 % better than TV, magazines and newspapers in brand recall. As for generating brand awareness, the report suggests that banners are about 40 % better than TV, but remain about 20 % worse than magazines.

In the report, "Correction: Does Internet Advertising Work? Yes, But...," Morgan Stanley vice president and Internet advertising analyst Michael J. Russell put the average banner cost-per-thousand price at a mere $3.50, adding, though, that that figure "looks like it is on pace to decline more than 10 percent for 2001." And, for interactive advertisers and agencies, the real deals are found in the plummeting prices of banner ad CPMs

But while actual CPM prices have been drastically reduced in recent months, few CPM ratecards list or admit to such low figures. According to the Russell's report, the average Internet advertising list price is still about $34 for banners. "Obviously," said Russell, "ratecards are woefully out of date…” But, he added, "if you're willing to make a make a couple of phone calls and find out what [Web sites] are really willing to take, [you'll find] a lot of these companies are pretty desperate and will take what you have." They'll also take smaller ad buys now, he said.

At TDE, Gerber, of TDE, foresees a large number of networks and sites dying over the next six to 12 months. He predicts that about 30 online properties controlling about 80 to 90 percent of all online ad spending will prevail. And these, he says, "will be primarily properties tied to the five major media companies."

Read more agency comments about banner buys here

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